KUALA LUMPUR – Axiata Group Bhd reported a net loss of RM106.38 million for the second quarter of 2022, compared to a net profit of RM277.75 million in the corresponding quarter, due to foreign exchange losses of RM475.7 million mainly contributed by mobile operations in Sri Lanka.
Out of the foreign exchange losses, RM370.5 million were unrealised foreign exchange losses due to exposure to the US dollar from US dollar-denominated loans and liabilities.
Excluding the foreign exchange losses, the telecommunication group’s net profit would have increased by 2.6% to RM425.8 million, driven by higher top lines and lower depreciation, as well as amortisation – partially offset by higher finance costs – taxes and lower one-off gains.
Revenue for the quarter ended June 30, 2022, stood at RM6.7 billion versus RM6.39 billion a year ago, it said in a filing with Bursa Malaysia today.
Joint-acting chief executive officer (CEO) Vivek Sood said with the improved operational performance, the group is likely to exceed the headline key performance indicators for the year both in terms of revenue excluding devices as well as earnings before interest and tax growth.
“Forex impact and macro headwinds especially in Sri Lanka, Bangladesh and Nepal had adversely impacted group earnings.
“To stem the tide, our immediate focus will be directed towards integrating new acquisitions, managing US dollar liquidity and inflation – especially in frontier markets – and easing out the balance sheet stretch,” he said.
Axiata said revenue for its Malaysia operations grew by 3.2% to RM1.68 billion during the quarter under review, mainly driven by improved prepaid performance coupled with contributions from new subsidiaries, Infront Malaysia and Bridgenet Solutions.
Revenue from its Indonesia and Bangladesh operations increased by 13.2% to RM2.19 billion and 4.7% to RM1.03 billion, respectively, while Nepal and Cambodia stood at RM365.4 million and RM393.5 million, respectively.
Joint-acting CEO Hans Wijayasuriya said in the medium-term, Axiata is cognisant of risks such as increased energy costs, global chip supply shortages and higher interest rates, whilst keeping a close watch on the impact of merger and acquisition transactions – specifically the timing of completion, impact to gross debt/earnings before interest, taxes, depreciation, and amortisation and delivery of synergies.
Moving forward, the group is confident of the learnings that could be applied group-wide from Project Resilience – a Collective Brain initiative being piloted to steady Dialog (Axiata Plc) against intense headwinds and macroeconomic pressures, he said.
“In recalibrating for growth, the aim is to improve the business topline, optimise and rescale costs, whilst aggressively adopting technology and analytics to protect product, network and the service experience.
“Ultimately, we want to enhance resilience and drive long-term value creation group-wide to benefit the customers and communities we serve as a regional digital champion,” he added.
No dividend was declared. – Bernama, August 26, 2022
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